Hathaway Inc. produces and sells golf umbrellas to local resorts. Hathaway anticipates April to be a busy month with the sale of 1000 umbrellas. The company has prepared the following static budget for April:

Sales revenue (1000 units) $40 000

Variable costs:

Direct materials 5000

Direct labour 6000

Overhead 1500

Fixed costs 4000

Net income $23 500

During April, Hathaway actually produced and sold 1300 umbrellas. What should be Hathaway's net income in April based on a flexible budget?

$31 500

$35 500

$31 750

$23 500